Nobody likes having to deal with debt collectors, but it is unfortunately a necessity sometimes. When you learn how to do this, you will make your life a whole lot easier. Simply ignoring these people will not solve anything, so you need to take some sort of action as soon as possible. This article will explain how to deal with debt collectors in a truly productive way.
1. Take Stock of Your Debts
You will want to start off by finding out how much money you owe so you can get a better idea of your financial situation. It’s also important to identify every creditor that you are in debt to before proceeding. Make sure that you request a copy of your credit agreement so you can look it over. The creditor will be obligated by law to provide you with these documents. It’s also a good idea to tell the debt collectors you owe money to that you only want to be contact via traditional mail. This will help you get relief from the harassing phone calls, emails and texts.
2. If you Can Pay, Do It.
If you have the money to pay your creditors, you should definitely do it right away. The sooner you get your debts settled, the sooner you can gain financial freedom. Once you have paid off all the money you owe, make sure it is reflected in your credit report. This can help boost your score considerably. Those who do not pay off their debts have a very difficult time raising their score.
3. If You Can’t Pay, Set up a Repayment Plan.
If you cannot pay back the money you owe to creditors, you should reach out to them to set up a repayment plan. Most debt collectors will be willing to work with you to come up with a solution that works for all parties involved. This will allow you to make regular payments on your debt so that you can avoid having a negative mark on your credit report for a long time.
It is also a good idea to look into getting some helpful information from a debt charity, as it could be of great assistance in this type of situation. Those who collect one of these charity agencies will get about one month grace period. This will give you a decent amount of time to get your finances in order. There are a lot of charitable organizations that can help you out, so you will need to look into some of them.
4. Know Your Legal Rights
It is a fact that debt collectors have no legal right to enter your home forcefully. Even bailiffs need written permission before they can be allowed in your home. Bailiffs can come into your home without your permission if you leave a door unlocked, so you will need to keep that in mind. The basic rule here is that they can get in as long as they don’t cause any damage whatsoever.
Debt collectors can get a portion of your wages until you have satisfied the debt, but it’s up to a judge to decide how much they can take. They cannot do this if you are unemployed or self-employed though.
5. Don’t Say More Than You Have to
It is never a good idea to say more than you absolutely have to when you are speaking with debt collectors. Always try to make each conversation as brief as possible, because otherwise you could end up getting yourself in trouble.
6. Always Try to Negotiate
Since most debt collectors are open to negotiating, you should definitely try to do this. Negotiating with these people can actually help you save some money and get more time to pay what you owe. Just explain your financial situation and tell them what you can afford to pay.
7. Dispute Any False Claims
If a debt collector falsely claims that you owe them money, always make sure that you deny owing anything in writing. This way there will be a written record of your dispute. If it goes to court, this can work in your favour.
8. Keep Records of All Correspondence
It is also a good idea to keep a record of all correspondence that you have with your debt collectors. Save every piece of physical mail as well as e-mails that you get. This information is very important.
Don’t Ignore Your Debt Collectors
Whatever you do, don’t simply ignore your debt collectors. There are always certain steps that you can take to work towards a resolution with them. Those who ignore these problems in life will find themselves buried in debt with a horrible credit score. The lower your credit score is, the more difficult it will be to get the loans you need.